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Owner of FedEx gambled company's last 5k to keep doors open (1971)...
Posted on 2/17/17 at 1:26 pm
Posted on 2/17/17 at 1:26 pm
Old article but I just heard about this myself for the first time. Germans I'm sure but I searched and didn't see anything, hence the thread. Some of you probably aren't familiar with this story so.....
Fred Smith is now worth an estimated $4.5 BILLION
LINK
quote:
In 1971, Fred Smith founded the company with $4 million of inheritance and $80 million in loans and equity investments. FedEx started out with eight planes, covering 35 cities, and it had plans to add more each month.
But in the first two years, primarily due to rising fuel costs, the company found itself millions of dollars in debt and on the brink of bankruptcy. Even worse, Smith's vital pitch for funding to the General Dynamics board was rejected.
quote:
When FedEx's funds dwindled to just $5,000, Smith realized he didn't have enough to fuel the planes. The company had already gone to many extremes, from pilots using their personal credit cards to fuel planes to uncashed paychecks.
So what's a desperate founder to do? Smith impulsively flew to Las Vegas and played blackjack with the last of the company money.
Amazingly, when he came back the next week, he had turned the remaining $5,000 into $27,000 — just enough for the company to stay in operation for another week.
quote:
Roger Frock, a former senior vice president of operations at FedEx, describes the scene when he found out what Smith did. "I said, 'You mean you took our last $5,000 — how could you do that? [Smith] shrugged his shoulders and said, 'What difference does it make? Without the funds for the fuel companies, we couldn't have flown anyway.'"
Fred Smith is now worth an estimated $4.5 BILLION
LINK
Posted on 2/17/17 at 1:28 pm to The Mick
Im heading to Harrahs with 5k. Wish me luck.
Posted on 2/17/17 at 1:28 pm to The Mick
quote:
Fred Smith is now worth an estimated $4.5 BILLION
And now he can play blackjack forever.
Posted on 2/17/17 at 1:28 pm to The Mick
That takes some cojones.
This post was edited on 2/17/17 at 1:29 pm
Posted on 2/17/17 at 1:30 pm to Bmath
quote:For sure, but like he said - the 5k was almost meaningless and he had nothing to lose.
That takes some cajones.
Posted on 2/17/17 at 1:35 pm to The Mick
He also failed business school with that idea
Posted on 2/17/17 at 1:39 pm to The Mick
quote:
, 'What difference does it make? Without the funds for the fuel companies, we couldn't have flown anyway.'
Truely inspirational. Putting the house on Red this weekend.
Posted on 2/17/17 at 1:44 pm to TheAlmightySmash
Making Memphis Great Again
Posted on 2/17/17 at 1:50 pm to The Mick
quote:
For sure, but like he said - the 5k was almost meaningless and he had nothing to lose.
Posted on 2/17/17 at 1:52 pm to The Mick
i heard that story from a econ professor at nlu back in the day. his take on it was that Las Vegas had a very strong interest in maintaining a method of shipping large quantities of currency that would not subject them to governmental control of the packages or the content. his view was that it was less a gamble than it was an "investment" by Las Vegas.
Posted on 2/17/17 at 1:59 pm to Honest Tune
He doesn't even have balls, he has whatever balls evolved into and he has become an evolutionary species built from pure testosterone to gamble with 5k as his company was going under.
Posted on 2/17/17 at 1:59 pm to The Mick
You think Memphis is a shithole now? Imagine Memphis without Fedex. It is the one company keeping it from becoming Jackson MS
This post was edited on 2/17/17 at 2:00 pm
Posted on 2/17/17 at 2:01 pm to Cosmo
Oddly enough, the Grizzlies have gone on a nice upward trend since moving there from world-class Vancouver.
Posted on 2/17/17 at 2:03 pm to Breesus
quote:
He also failed business school with that idea
I have a buddy who has a PhD in business and has no clue how to run one. Admittedly said that I could run a business with my eyes closed better than he could with all of his education. At least he understands, experience >>>>>>>>education.
Posted on 2/17/17 at 2:06 pm to lsuhunt555
quote:
And now he can play blackjack forever.
Not if he bets it all on one hand and losses.
Posted on 2/17/17 at 2:08 pm to The Mick
I don't believe that is was as black and white as that story painted it to be
ETA- these types of stories seem too fabricated to me, I'm sure some details were exaggerated to make it seem more 'hollywood'
ETA- these types of stories seem too fabricated to me, I'm sure some details were exaggerated to make it seem more 'hollywood'
This post was edited on 2/17/17 at 2:10 pm
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